What do if my uncle gave me 13k to start a business and now I’m offering him 25k for his initial investment but he states that he wants 50k?

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What do if my uncle gave me 13k to start a business and now I’m offering him 25k for his initial investment but he states that he wants 50k?

There was never any contract made agreeing to any amount. Can he sue me? He is the treasurer on the corporation; I am the president. Can I remove him? /he gave me the money 1 year ago.

Asked on August 14, 2015 under Business Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

Was the money a loan or an investment? If it was a loan, he can require it to be repaid according to the terms of the loan. If it was an investment, the issue is, what % ownership does he have, and therefore what degree of control does he have? If there was no written agreement, then there is no easy answer as to what his ownership and control is--that is, there is nothing to reference which provides the answers as to what authority and rights he and you respectively have. If you can't work this out voluntarily between the two of you, one of you will need to file a legal action and put this before a court, which will determine who owns what and who has what authority, and only after those questions are resolved, can the issue of how much money he may or may not be entitled to be resolved.

(If the business is an LLC, for example, ownership is not necessarily dependent on investment: if the only money in the business is your uncle's, but you are the active, day-to-day employee, he could legally own 0% of the business to 100% or anything in between.)


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